Archive for April, 2014

Why You Should Use A Mortgage Broker

Saturday, April 19th, 2014

The Top Reasons Why You Should Use A Mortgage Broker

People who are in the market to purchase a home or apartment should be aware that they must be pre-approved for mortgage finance before they begin the home shopping process. However, it is not only important that they are pre-approved; they must be pre-approved by the right type of lender. There are different types of lenders that you can choose from. Most people go to a bank but there are others too including credit unions, secondary banks and private lenders are some of the choices that you have, but which option is the best one for you?

More and more potential home buyers and those who are looking to refinance an existing mortgage loan are choosing to work with mortgage brokers. There are many reasons why this lending option has become so popular.

One of the biggest investments most people will ever make is the purchase of a home. Mortgages are financial tools that hold value but it is secured on the property you are buying. That means that if you do not keep up your repayments, then the lender can repossess your property. Many people were misled about lending and encouraged to borrow more than they should. This led to the GFC we have been through these last few years. Many borrowers are now asking questions when they are looking to finance for the first time, or refinance an existing mortgage.

So, why should you choose a mortgage broker? The following reasons may help you decide if it is the right decision for your current financial situation.

There Are More Mortgage Choices Than Ever

Mortgage brokers are able to access mortgages from a variety of lenders. This type of versatility provides the clients with several choices for financing, and the clients are able to decide on the best mortgage rates and options. The partnerships that mortgage brokers develop through their network can include:

  • Banks
  • Trusts
  • National lenders
  • Regional lenders
  • Credit Unions
  • Non-traditional lenders
  • Private lenders

Your broker will be able to create the best mortgage for your needs.

Mortgage Brokers Focus On Their Clients

When you work with a mortgage broker, the broker is working for you exclusively. Mortgage brokers do not work for lenders. This means that your mortgage will be tailored to you, and not to the lender.

A Mortgage Broker Can Negotiate On Your Behalf

Albany Mortgage broker

Mortgage broker on phone

Lenders are in the business of approving loans, and they want to offer a better rate than their competition. A mortgage broker uses this knowledge to your advantage to help secure the mortgage rates that is best for you.

A Mortgage Broker Is Updated On Promotions

Few home buyers know that rates, discounts and promotions exist in the financial world. Lenders offer promotions and special rates several times during the year. Mortgage brokers are aware when lenders are offering these special rates, and they can use this information to determine if any special offers would be beneficial to you.

A Mortgage Broker Can Help Secure A Lower Rate

If you are able to get a lower rate on your mortgage, you may be able to save thousands of dollars throughout the life of your mortgage. Homeowners will often call a mortgage broker for a first time mortgage or refinancing so they can save money. It is important to remember to call your mortgage broker early. Most rates can only be guaranteed up to 120 days.

A Mortgage Broker Is Focused

Unlike lenders, mortgage brokers only work with one type of financial product. They stay updated with the new trends in the mortgage industry, and they use this knowledge to serve the needs of their clients better.

A Mortgage Broker Is Usually Free To You

Brokers do not usually charge their clients a fee. Instead they receive a commission from the lender on settlement of the house purchase. This can be very handy at a time when you are facing many other costs and fees for your house purchase.

You Only Need To Have One Inquiry On Your Credit Report

Mortgage home finance

New home owners

Comparative rate shopping for mortgages can wreak havoc on your credit report. Whenever a lender checks your credit report, the major credit bureaus are notified. If there are too many inquiries on your credit report, your rating may decrease. This can eventually affect the type of mortgage and rates you qualify for. A mortgage broker only makes one inquiry, and this inquiry is used for all of the lenders you are considering.

If you are considering purchasing a new home, or you want to refinance the one you currently own, you should consider talking to a mortgage broker in Hamilton, the North Shore, West Auckland or an Albany mortgage broker. The broker will help secure the best deal for you. A mortgage broker can help people through the complicated maze of jargon, data and offers that are available in the NZ mortgage market.